A $700 billion war chest: India's external sector needs skilful management
6 min read Last Updated : Oct 15 2024 | 10:21 PM IST
Increasing geopolitical tensions in West Asia have put pressure on the Indian rupee, which breached the 84 mark against the US dollar last week. There are primarily two reasons why the rupee could witness volatility if the conflict escalates. First, the conflict could increase risk aversion among foreign investors, resulting in capital outflows. Second, it could potentially disrupt the supply of crude oil, leading to a significant increase in prices. Since India imports the bulk of its crude oil needs, this could increase dollar demand. Higher energy prices are always a risk for India. While oil prices
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